A man wearing protective face mask rides a bicycle in the central business district (CBD) in Beijing, EPA/Wu Hong

OPINION – Socioeconomic issues arising from Covid-19 and the Chinese responses

The social and economic issues emerging from the outbreak and spread of Covid-19 have been enormous and the mainland Chinese government has been trying its best to cope with them.

First, the mainland economic situation has dipped tremendously; the GDP in the first quarter of 2020 dropped by 6.8 per cent compared with the same period in 2019, reflecting the emergent problem of unemployment, the rapid decline in investment, and the decrease in both exports and imports.

Except for internet-related and high technological sectors, all other economic sectors have seen a drastic drop in their performance. Internet-related sectors registered a surprising increase of 10 per cent in their business expansion in January and February 2020. The high-tech sector witnessed an increase of 9 per cent in its business expansion in March 2020, including 3-D copying facilities and smart watches.

The Internet retail sector has envisaged a rise of 5.9 per cent in its business growth. Since March 29, the average incoming flights to China has recorded a daily number of not more than 20, with an arrival of merely 2,000 to 3,000 air passengers every day.
The most drastic drop in business was seen in the aviation sector, which saw a rapid fall of 71 per cent of the total passenger load and an estimated loss of 39 billion yuan.

Second, due to the need for families to stay home during the outbreak of Covid-19, it was surprising to see a rapid increase in the divorce rate of some mainland cities. The reason was that, according to the media reports, many couples had to stay together for more time than ever before, and their family disputes and conflicts ironically increased.

Third, because many people stayed home to avoid being infected unnecessarily, electronic games have been emerging very rapidly. Nevertheless, some of the popular electronic games added elements entailing politically sensitive content, including words that were politically satirical. As such, the Chinese authorities exerted tighter control on the content of electronic gaming platforms, ensuring that they do not contain politically sensitive and unacceptable ingredients.

Fourth, due to the rapid increase in the demand of infrared thermometers, some thermometers of substandard quality were produced by unscrupulous businesspeople. Some criminal elements cheated citizens by selling substandard infrared thermometers.

In Guangzhou, the law-enforcement authorities cracked down on a case in which some dishonest people deceived 6 million yuan from residents who bought infrared thermometers. Just like some masks with poor quality were found by the customs department in Hong Kong, the mainland society was also affected by some substandard products that help citizens protect themselves and check their body temperatures.

Fifth, in Guangzhou, a minority of African residents were infected with Covid-19, but misunderstandings and disputes erupted between them and the Chinese law-enforcement authorities. The misunderstandings erupted into a diplomatic concern on the part of some African countries, which grouped together to ask the Chinese government to tackle the problem of “discrimination.”

The Chinese government explained the situation to the African diplomats concerned, while the city of Guangzhou has recently hired more Africans to act as translators and to minimize misunderstandings and miscommunications between a minority of infected Africans and the Chinese officials.

Sixth, because of the restrictions in air travel, some people tried to be smuggled in and out of China. In Yunnan province, from March to April there were about 1,600 cases of human smuggling that involved 3,600 people who were employed, who entered the mainland and who stayed in the province illegally. In response to illegal human smuggling, the police in Yunnan cracked down on human smuggling syndicates, whose activities could endanger the public health of both illegal migrants and residents.

On April 17, the Politburo held a meeting chaired by President Xi Jinping to discuss the progress of containing Covid-19. The meeting reached several decisions to deal with the ongoing Covid-19 development and to prepare for a gradual socioeconomic recovery in China.

First, all provinces and cities will continue to consolidate the results of countering Covid-19, grasp the technical details, and prevent the import of infected Covid-19 cases. The necessity of protecting the public health of residents is indispensable for all localities to resume economic production and ensure stable social order.

Second, Wuhan and the Hubei province will need to care about the residents who are seriously affected by Covid-19, to strengthen the work of community prevention of the disease, to conduct strict quarantine work of all of the people concerned, and to exchange intelligence on the ongoing Covid-19 development. Both Wuhan and Hubei province must develop policies in favour of the livelihood of the residents, including the need to solve their problems in employment and schooling.

The city of Wuhan has already implemented a scheme of distributing consumption coupons to residents to stimulate consumption and assist their livelihood.

Third, the Politburo mentioned the need to be caring toward the Chinese citizens who live and work in overseas countries, providing consular protection for them, and advising them on how to protect themselves from Covid-19. The outbreak of Covid-19 has already affected the wellbeing of some overseas Chinese, many of whom were afraid of wearing masks for fear of being discriminated against. Some cases of discrimination involved a few overseas Chinese.

Although the wearing of masks is now commonplace in many countries, overseas Chinese generally need not only the understanding of the residents of their host countries but also the full support of the Chinese government.

Fourth, macro-economic measures must be taken to tackle the economic impacts of Covid-19, including a flexible monetary policy, the deployment of tools such as lowering the interest rate and offering more loans, and the capital support for small and medium enterprises.

Fifth, the central government encourages the provinces and cities to expand internal consumption through an increase in public expenditure, infrastructure investment, the conversion of old districts into new ones through urban renewal, and the reform and adaptation of traditional industries. Tax reduction is encouraged, the costs of capital accumulation must be reduced, and the rent for housing units has to be adjusted.

The logistical supplies of various industries should be protected and promoted, while the labour force in poor regions has to be utilized. Other protective measures include the need to help school graduates to find jobs, to reduce poverty, to curb any property speculation, and to ensure adequate food supplies and agricultural production.

Finally, President Xi signed the commendation certificates to praise all those officers of the People’s Liberation Army who were sent to work in various hospitals in Wuhan and Hubei province.

Overall, although there have been considerable socioeconomic issues that stemmed from the outbreak of Covid-19, the Chinese government has been adopting a proactive and assertive approach in responses to all of these issues, trying to bring the society and economy back to normalcy.